Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Celgene Corp., FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
The financial performance between 2014 and 2018 is characterized by a general expansion in cash generation capabilities, although the volatility of equity-available cash flows significantly exceeds that of core operating activities.
- Net Cash Provided by Operating Activities
- A sustained upward trajectory is observed in operating cash flows, which increased from US$ 2,806 million in 2014 to US$ 5,171 million in 2018. Aside from a slight contraction in 2015, the trend indicates a strengthening of the core operational capacity to generate cash, with the most pronounced growth occurring between 2015 and 2017.
- Free Cash Flow to Equity (FCFE)
- FCFE exhibited substantial volatility throughout the period. Following a peak of US$ 9,495 million in 2015, a sharp decline to US$ 3,740 million was recorded in 2016. This was followed by a strong recovery, reaching US$ 9,293 million by the end of 2018. These fluctuations suggest inconsistent capital expenditure patterns or strategic shifts in financing activities.
- Relationship Between Operating Cash Flow and FCFE
- In four of the five years analyzed, FCFE exceeded net cash provided by operating activities. This disparity suggests that net borrowing or the sale of assets likely contributed to the cash available to equity holders. Conversely, 2016 represents a notable exception where FCFE dropped below operating cash flow, indicating a period of heightened capital investment or significant debt repayment.
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Price to FCFE Ratio, Current
Celgene Corp., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 711,714,480 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | 9,293) |
| FCFE per share | 13.06 |
| Current share price (P) | 108.03 |
| Valuation Ratio | |
| P/FCFE | 8.27 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| AbbVie Inc. | 26.71 |
| Amgen Inc. | 92.74 |
| Bristol-Myers Squibb Co. | 16.74 |
| Danaher Corp. | 24.90 |
| Eli Lilly & Co. | 65.44 |
| Gilead Sciences Inc. | 24.41 |
| Johnson & Johnson | 22.28 |
| Merck & Co. Inc. | 15.46 |
| Pfizer Inc. | 18.15 |
| Regeneron Pharmaceuticals Inc. | 21.55 |
| Thermo Fisher Scientific Inc. | 21.36 |
| Vertex Pharmaceuticals Inc. | 41.83 |
Based on: 10-K (reporting date: 2018-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Celgene Corp., historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 702,164,345 | 752,175,608 | 777,966,471 | 781,664,535 | 800,590,656 | |
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in millions)2 | 9,293) | 6,531) | 3,740) | 9,495) | 4,681) | |
| FCFE per share3 | 13.23 | 8.68 | 4.81 | 12.15 | 5.85 | |
| Share price1, 4 | 89.71 | 95.16 | 115.61 | 99.59 | 123.43 | |
| Valuation Ratio | ||||||
| P/FCFE5 | 6.78 | 10.96 | 24.05 | 8.20 | 21.11 | |
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
| Vertex Pharmaceuticals Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
1 Data adjusted for splits and stock dividends.
3 2018 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 9,293,000,000 ÷ 702,164,345 = 13.23
4 Closing price as at the filing date of Celgene Corp. Annual Report.
5 2018 Calculation
P/FCFE = Share price ÷ FCFE per share
= 89.71 ÷ 13.23 = 6.78
6 Click competitor name to see calculations.
The analysis of the price to free cash flow to equity (P/FCFE) ratio between 2014 and 2018 reveals a period of significant valuation volatility. While the share price exhibited a general downward trajectory over the five-year period, the FCFE per share fluctuated considerably, leading to erratic shifts in the P/FCFE multiple.
- Share Price Trends
- The share price decreased from a peak of 123.43 US$ in 2014 to 89.71 US$ by 2018. A temporary recovery occurred in 2016, where the price reached 115.61 US$, before resuming a decline through 2017 and 2018.
- FCFE per Share Performance
- Free cash flow to equity per share demonstrated high variability, characterized by a notable dip to 4.81 US$ in 2016. However, a strong recovery followed, culminating in a five-year high of 13.23 US$ in 2018, representing a substantial increase from the 2014 baseline of 5.85 US$.
- P/FCFE Ratio Interpretation
- The P/FCFE ratio experienced sharp oscillations, peaking at 24.05 in 2016 during a period of diminished cash flow. By 2018, the ratio compressed to its lowest level of 6.78. This compression was driven by the simultaneous occurrence of the lowest share price and the highest FCFE per share in the analyzed period, suggesting that the market valuation did not keep pace with the growth in the company's capacity to generate cash for equity holders.
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